CORRECTED-Coming soon to Facebook- more action, battle games

SAN FRANCISCO, Feb 1 When nWay began a trial of
its dark, sci-fi combat game "ChronoBlade" on Facebook last
year, the San Francisco-based startup felt sure it had a hit on
its hands.

"First of all, what comes is, 'Wow, I had no idea you could
actually do a game of this quality on Facebook,'" said Dave
Jones, Chief Creative Officer of nWay, who has worked on "Grand
Theft Auto."

Then came some resistance: Jones admits some potential
investors and partners questioned how an action-focused game
with slick graphics can play to a Facebook audience more
accustomed to "Farmville" and other less time-consuming casual
games. Others wondered how the game -- which launches this
spring -- would gain significant users and revenue on the social
network.

But Facebook Inc is betting nWay and a clutch of
other developers this year can extend console-style action games
beyond Microsoft Corp's Xbox or Sony Corp's
PlayStation onto the world's largest social network.

Facebook is spearheading the launch of 10 high-quality games
created by third-party developers in 2013 that squarely target
so-called hardcore gamers, an atypical audience overlooked thus
far against the wealth of family-friendly offerings like Zynga
Inc's "Farmville" that now dominate the social
network's gaming landscape.

The effort, which began late last year but will accelerate
in 2013, is part of Facebook's ongoing objective of making sure
its 1 billion-plus users log in and spend more time on the
network, which in turn boosts ad revenue. Facebook also takes a
cut of its applications' revenue.

Facebook's push into action and battle games follows a
meeting in January between companies that make games like
"first-person shooters" and Vice President Joe Biden to look for
ways to curb gun violence in the wake of the Connecticut school
shootings.

Based on the console gaming industry experience, hardcore
gamers -- typically men 18 to 30 years old -- spend more time
and effort to master fast-paced games such as first-person
shooters (Microsoft's "Halo") or real-time strategy games
(Activision Blizzard's "StarCraft").

"You'll see a whole set of games hitting in the next two
quarters in particular and throughout the year that really start
to redefine what people think of Facebook games," Sean Ryan,
head of game partnerships at Facebook said in an interview.

Facebook will embrace games from "casual all the way up
through first-person shooters, massively multiplayer online
games, real-time strategy games - all those types of more core
player-versus-player games."

Just as hardcore gamers interact online and form clans in
multiplayer games on console game networks like Xbox LIVE,
Facebook can be that social layer needed to foster such gaming
communities that help popularize titles, Jones said.

GAMING POPULATION

Over a quarter of Facebook's 1.06 billion monthly active
users play games, one of the largest gaming communities in the
industry, and the social network hopes that can grow.

Facebook also aims to make more revenue from games. Revenue
from the area was flat in the fourth quarter from a year ago,
the company said on Wednesday without providing details.

The 8-year-old social network takes a 30 percent revenue
share from game developers who offer their product free but then
charge for virtual goods -- like ammunition and power boosts.

On Wednesday, Facebook's Chief Financial Officer David
Ebersman told analysts on a post-earnings conference call that
its "games ecosystem continues to show healthy signs of
diversification" and suggested that games revenue would grow
with increasing user engagement.

To grow its gaming business, Facebook has invested time and
resources to work with developers since the summer to bring
titles like u4iA's first-person shooter "Offensive Combat" and
Plaruim's real-time strategy game "Stormfall: Age of War"
alive, Ryan said.

"It doesn't mean we're walking away from other games, but
there's no question our focus for 2013 much of it will be about
becoming a better platform for core gamers and developers who
make those games."

To help users discover them, Facebook added new action and
strategy games categories on its App Center that also shows you
friends from your list playing those games. It brought back
notification messages from game apps -- a feature that had been
removed because users found them annoying -- with certain
restrictions that stop developers from spamming a gamer.

Developers also rely on word-of-mouth publicity and ads on
Facebook's advertising platform to draw in prospective gamers.

"Stormfall" has a player base of 4.5 million and hardcore
games were proving to be far more lucrative, said Gabi Shalel,
chief marketing officer Of Tel Aviv, Israel-based Plarium.

"Hardcore gamers pay more, play more and generate higher
average revenue per user than traditional casual games."

Kixeye, which makes the warfare-strategy game "War
Commander," said its gamers spend 20 times more than players of
social games, helping it stay profitable over the past three
years.

Going forward, nWay's Jones says Facebook must have a
defining title that comes along that establishes it as a
hardcore gaming spot for gamers.

"Like 'Super Mario' did for Nintendo or 'Halo' on Microsoft,
I think it just takes one title to come along, sort of as a
benchmark to legitimize the whole thing," he said.
(Reporting By Malathi Nayak; editing by Andrew Hay)

Dec 9 American Airlines Group Inc said
higher average fares per mile have boosted its revenue and
profit expectations for the fourth quarter, a day after rival
United Continental Holdings Inc also raised forecasts.

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